Vice President Joe Biden met with congressional negotiators last Thursday to discuss ways to curb the federal deficit and permit new borrowing after August 2, the day the U.S. government is expected to reach its $14.3 trillion borrowing limit. Democrats want to curb the federal deficit by pushing for new taxes and eliminating many tax loopholes, while Republicans have called for steep spending reductions but no new taxes.
To discuss the ongoing debate over how to curb the federal deficit, Democracy Now! recently spoke with Sally Kohn, author of a May 24 USA Today op-ed titled Don’t Believe the Hype About U.S. Debt.
SALLY KOHN: You know, this is the time when we should be worrying about other things than public spending. I mean, the fact of the matter is that corporations are sitting on record levels of capital. They’re not spending it. There’s new news out that, if anything, they’re not spending it on jobs; they’re spending it on new, you know, manufacturing equipment. So the problem is, in this situation, like it or not, government is the spender of last resort. And the irony with all this, when everybody says, “Well, government should be tightening its belt, so is everyone else,” you know, we let corporations — we actually encourage corporations in this country to borrow and carry debt ratios sometimes three, sometimes four, 14, 50 times higher than government.
Boeing, IBM, JPMorgan. JPMorgan has a debt-to-income ratio of 50 to one. The United States government? One to one. So, why is it that debt is good for private corporations, for successful private corporations, so they can invest in the future of their business, but not good for the government, especially at a time of anemic tax receipts, because we’ve cut taxes, among other things, and because the economy is sluggish? Why shouldn’t we use government to invest in the future of our nation and the future of our citizenry?
Video
Source: Democracy Now!
To discuss the ongoing debate over how to curb the federal deficit, Democracy Now! recently spoke with Sally Kohn, author of a May 24 USA Today op-ed titled Don’t Believe the Hype About U.S. Debt.
SALLY KOHN: You know, this is the time when we should be worrying about other things than public spending. I mean, the fact of the matter is that corporations are sitting on record levels of capital. They’re not spending it. There’s new news out that, if anything, they’re not spending it on jobs; they’re spending it on new, you know, manufacturing equipment. So the problem is, in this situation, like it or not, government is the spender of last resort. And the irony with all this, when everybody says, “Well, government should be tightening its belt, so is everyone else,” you know, we let corporations — we actually encourage corporations in this country to borrow and carry debt ratios sometimes three, sometimes four, 14, 50 times higher than government.
Boeing, IBM, JPMorgan. JPMorgan has a debt-to-income ratio of 50 to one. The United States government? One to one. So, why is it that debt is good for private corporations, for successful private corporations, so they can invest in the future of their business, but not good for the government, especially at a time of anemic tax receipts, because we’ve cut taxes, among other things, and because the economy is sluggish? Why shouldn’t we use government to invest in the future of our nation and the future of our citizenry?
Video
Source: Democracy Now!
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